3 Ways to Find the Best Locations for Your New Property Purchases

3 waysYou have a property or two under your belt, but they may beeither a home you formerly lived inor a one-off investment. Now you’re ready to look at new investment properties by researching the best locations for your nextpurchase. Property managers have plenty of tools at theirdisposal to help them determine the hottest markets for income properties. There are three key trends to considerwhen you’re trying to predict which markets will be the most lucrative in the short, medium, and long term.

1. Pay attention to redevelopment programs

Some areas of your city may look like they willnever recover from blight, but keep an open mind. Many city officials, developers, etc.seek to develop the most undesirable neighborhoods througha variety of initiatives. In many cases, these effortsresult in improved housing prices in areas that would previously have made for a bad investment.

Timing is key. You should try to purchase in these areas while revitalization programs are kicking off and appear successful, but before other investors realize the neighborhood will be a real estate hot spot inabout five years. Another advantage of redevelopment programs is the fact that they often result in lower costs when purchasing a property, as there are sometimes local subsidies offered to people willing to invest in areas that are being rebuilt. Talk to your local chamber of commerce to determine whether programs like this exist in your area.

2. Watch where businesses are building

Before you select the location of your next investment property, take the time to track theareas where businesses are setting up shop. This allows you to purchase your propertyin a commuter-friendly area. Businessesmay be cropping up because of the aforementioned redevelopment programs, or they may be taking advantage of a buyers'real estate market. Either way, new businesses can be a tip off that a neighborhood is growing and will be appealing to a tenant.If businesses have branches elsewhere in the country, it’s also likely that they are relocating employees from other regions. This helps drive the demand for rental housing, since recently-relocated professionals may want to rent before purchasing a house in thearea.

3. Keep track of school district rankings

School district rankings are long-term metrics to track. Choosing a property within range of an excellent school districts helps you attract parents for whom well-ranked schools are an important variable in choosing a home. Consider seeking outschool districts that are making major improvements to schools. This allows you to purchase a property before the real estate costs reflect the proximity to desirable schools.When you purchase an investment property in a good school district, you’re getting an investment property that is geared for long-term success, since parents will always want their children to attend the best schools.

Purchasing lucrative investment properties is part luck and part skill. As you gain experience in property management, you’ll find that the skill portionof the equation helps you develop long-term strategies for taking advantage of rental and property trends. By conducting a little research and keeping an eye on the happenings of an area, you can locate the next real estate hot spot before it gets going.
POSTED October 22 2014 1:38 PM

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